BU121 Lecture 8: 8. Entrepreneurial Finance
Document Summary
Cash breakeven, contribution analysis, cash budgeting, cash burn, new venture. Employers may give employees some ownership of the business: venture character and reputation can be assets or liabilities. While accounting is the language of business, cash is the currency. If you sell things on credit, you made the sales but don"t receive the cash. Money in oe are the money that owners put in to invest in the business: but you already used it to help with the expenses it"s not just sitting there. Some new ventures show profitability during the startup stage, but . It is more common for a new venture to have losses survival stage. Need to know level of sales (survival revenue) necessary to cover costs and breakeven. And need to do this on a cash basis. At survival/cash flow breakeven ebdat (earnings before depreciation/amortization and taxes) = 0. If you"re trying to breakeven, you won"t have tax since you don"t have profits.
